Rising prices, especially on food, gas, rent and other necessities, are upending the lives of millions of working people. What government officials insisted would be “transitory” is in fact part of a longer-term crisis the capitalist rulers are putting on our backs.
The government’s consumer price index rose to 7.9% for the 12 months ending in February, the highest increase in 40 years. And these “official” government figures undercount what working people really face.
Strikes by workers and their unions — from the teachers in Minneapolis to coal miners in Alabama to Machinists in Davenport, Iowa — are demanding wage raises to cover rising prices.
“These struggles set an example for millions facing similar conditions and need support from other workers and our unions,” Alyson Kennedy, Socialist Workers Party candidate for governor of Texas, told the Militant. “To protect workers from the ravages of inflation, our unions need to fight for cost-of-living adjustments in every contract and all benefits that raise our wages to match every price increase we face.”
As every worker buying groceries knows, prices for many items are actually much higher than official figures. Prices for groceries rose at an annual rate of 8.6%, but meat, poultry, fish and eggs, key sources for protein, are up by 13%. Prices for fruit and vegetables jumped, while the cost of dairy products was the largest in nearly 11 years.
The New York Times interviewed working people across the country and described what they said: “Bacon is as expensive as filet mignon used to be”; “I am eating expired groceries”; and “I go several days in a month skipping meals or just not eating.”
Energy prices increased 26% from a year ago and the cost of gasoline is going through the roof, rising to over $4 per gallon. In some areas, like San Francisco, the average price is $5.75.
Among those especially hard hit by these price hikes are Uber and Lyft drivers and owner operator truckers. Their bosses force them to pay for their own gas, wreaking havoc with their take home pay.
Some owner-operators have had to take their trucks off the road, because they can no longer make a living as diesel prices have reached all-time highs.
Fleet driver James McCurdy told WCNC his boss called him and other drivers instructing them to stop idling their trucks to save fuel. “In the wintertime, we can’t shut it down because we’ll freeze to death,” he said.
Average wages rose by 5.1% over the past year, but with rising prices workers’ real wages dropped — by a 2.6% annual rate in February. Households with low income bear the brunt as they spend a greater part of their income on food and gasoline than those in the middle and ruling classes.
Two years after the COVID-19 pandemic began, there are 2.3 million less workers in the labor force. As prices are climbing, bosses are trying to maximize profits by pursuing a broader offensive against us through speedup, longer shifts, mandatory overtime and weakening safety on the job. Farmers too, are facing significantly higher prices for weed-killing chemicals, crop seeds, fertilizer and equipment repairs, sinking income below their costs of production. “I just don’t see how I’m going to get paid this year,” Brooks Barnes, a second-generation farmer in Wilson County, North Carolina, told the Wall Street Journal Feb. 15.
His farm grows tobacco, corn, soybeans, wheat and sweet potatoes. In February he paid $60 a gallon for Bayer AG’s Roundup weed killer, up from $16 a gallon the previous year. Fertilizers jumped to $500 a ton, from $175 last spring.
“To protect farmers from ruin, the government must guarantee their costs of production,” Kennedy said. “To build the fighting movement of working people we need, we must forge an alliance with working farmers, who are exploited by the same capitalists as we are.”
Wage raises don’t cause inflation
The bosses and their media falsely claim that rising wages lead to high prices. This is false.
Inflation is a phenomenon that arises when the purchasing power of a capitalist nation declines. The government and banks crank up their printing presses and crank out money and other financial paper to make up the difference, quickly outstripping the output of commodities that could be purchased with that bloated monetary supply. Under these conditions, capitalists competing for profits boost prices up and up, all of which lowers workers’ living standards. So wage increases do not drive inflation, it only means we get to keep more of the wealth we produce and the bosses take less in profits.
“We need to break from the Democratic and Republican parties and form our own party, a labor party based on our unions,” Kennedy said.
“Such a party can organize workers by the millions and attract allies to common struggles to defend our families and livelihoods against the profit-driven assaults of the employing class.”